30 Mar 2012
“As a result of an amendment to the Fair Trading Act 1999 (VIC) which was introduced last year, debt collectors must stop contacting debtors once asked to do so in writing,” says Brett Turnbull, Solicitor Director for Mason Black Lawyers. “Even if the debtor is liable for the debt, the collection agency must stop contacting the debtor and instead commence legal action.”
In this case, two debt collection agencies are alleged to have continued contacting two women after they received letters requesting they either desist or launch legal action. The Consumer Action Law Centre has commenced proceedings in the Victorian Civil and Administrative Tribunal on behalf of the women.
“The frequency and methods of contact have often been abused by some collection agencies, and the new law seeks to protect consumers against this. However, it may have the unintended effect of prompting numerous debt-related legal proceedings where the debtor faces additional costs and may have no defence for not paying the outstanding debt,” Brett says.
Mason Black Lawyers keeps recoveriescorp up to date with changes to its legal obligations under the Fair Trading Act 1999 (VIC), the Competition and Consumer Act 2010 and the Australian Securities and Investments Commission (ASIC) Act 2001. Recoveriescorp strictly adheres to the Fair Trading Act guidelines regarding contact with debtors, record keeping, legal action and privacy obligations.
Recoveriescorp’s training for collections staff is also overseen by Mason Black Lawyers.
“Collections agencies and accounts receivable departments need to be extremely vigilant, particularly if overseas call centres are involved. They must adhere to Australian laws and be aware of the permissible timeframes in Australia for phone contact with debtors,” Brett says.